Our convenient mortgage calculator is here to assist you in estimating your monthly mortgage payment and the maximum amount you can borrow for your buy-to-let property.
Please be aware that the information provided in this Mortgage Calculator and accompanying commentary is for informational purposes only. It’s essential to note that this information might not be up to date or comprehensive, and its applicability may be limited to specific types of residential properties in England and Northern Ireland. This content should not be considered as professional advice.
Kindly note that this calculation is a rough estimate of your monthly repayments. The actual amount may vary based on the terms and conditions set by your lender.
Why are interest-only mortgages calculator a common choice for buy-to-let properties?
Property investors often opt for interest-only Buy-To-Let mortgages to finance their investments because they consider them cost-effective and are confident that rental income can cover the expenses. Investors with fixed-rate mortgage deals won’t experience rate fluctuations until their existing offer concludes. However, those with tracked and variable rates may see increasing mortgage expenses tied to the base rate erode their profits.
If you already hold multiple Buy-To-Let mortgages, you might want to explore consolidation as a means to potentially reduce your overall debt payments by merging multiple liabilities into a single property loan. This can be particularly advantageous if you’ve had varying interest rates on your prior loans. Discussing this option in greater detail with one of our specialized property accountants can help you explore the available alternatives.
What happens at the end of an interest-only Buy-To-Let mortgage calculator?
At the conclusion of an interest-only mortgage calculator for your buy-to-let property, you must fully repay the initial amount borrowed.
n this mortgage structure, you make monthly interest payments while deferring the entire loan repayment until the end of the term. In most instances, your lender will remind you of the impending deadline at least a year before your term concludes. Your lender will then contact you again six months before the end and, as the closure date approaches, contact you once more. During this process, your lender will provide a redemption statement, specifying the exact amount due for repayment.
How much is the deposit for an interest-only Buy-To-Let mortgage?
The deposit requirement for an interest-only Buy-To-Let mortgage calculator can differ from one lender to another. Lenders now require a deposit, and their lending depends on property rental income and prevailing interest rates. Generally, most Buy-To-Let lenders adhere to an interest cover formula. Typically, they insist that the rental income should be sufficient to cover around 125% to 140% of the interest payments.
For Buy-To-Let mortgage assistance, contact us at info@reallywickedaccountant.com or use our online form to reach tax advisors.